House prices suffer biggest drop in three years

House prices suffered their biggest fall in more than three years in October, with buyers’ confidence now in danger of slumping lower after Thursday’s interest rate hike. The average house price in the UK fell by 1.2 per cent to £296,285 in the 12 months to October, according to the Lloyds house price index. This was the biggest drop in prices recorded since October 2023 and is much steeper than the fall recorded in the 12 months to September, when prices fell by only 0.1 per cent. Property market experts said the Bank of England’s decision to hike interest rates this week will only worsen the outlook facing buyers, who are holding off for better conditions, and sellers, who are pushing down asking prices to shift their homes. London’s housing market continued to be the worst-hit by rising mortgage rates and fears of rampant inflation. The average house price in the capital fell by 3.1 per cent to £524,892 in the year to October. This was compared to price growth of two